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Retailers Are Not Ready for Mobile Commerce

08/09/2012

Consumers have changed the retail and service sector landscapes considerably since 2008.

The shroud of the weak economy and uncertainty about job security caused consumers to slam their wallets closed in 2008. And while there are occassional glimmers of improvement in the economy and consumers’ outlooks – neither is improving with the consistency or increases necessary to break out of the slump. The negative tone the presidential campaign has already taken is not helping matters nor is it “presidential”.

In 2009 and 2010 eCommerce gained serious momentum. After a healthy 12.6% increase to $176.2 billion in 2010, U.S. online retail sales are expected to reach $278.9 billion in 2015. Online shopping will continue to cannibalize in-store shopping as consumers become more familiar and begin, in many cases, to prefer the convenience of online shopping.

Both of these factors have played heavily into creating an urban landscape full of empty big box stores and empty shopping malls. After several years of vacancy big box store sites are being converted to medical facilities to support the growing needs of the aging boomer population. And the malls? Grocers are considered the new ideal tennent for vacant mall space.

The next trend to hit retail is mCommerce. That’s “m” for mobile. With smartphone ownership in the US at an all time high – 54% of US mobile phone owners now use a smartphone as of June – the impact of mobile on commerce is just beginning to be felt. Mobile is projected to influence 5.1% of retail sales this year. Of the $3 trillion projected in retail sales for 2012, mobile’s impact will be a whopping $159 billion!

It’s difficult to project how mCommerce will affect bricks and mortar retail. The concept of “showrooming”, introduced by Amazon was perhaps the first big mCommerce trend. It’s safe to say other trends will emerge rapidly in the next couple of months.  And when they do retailers will need to be on top of it or suffer the nasty consequences.

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